Question
Is there a multiplier to approximate inventory level based on sales?
I need to set up an inventory budget for next year. I took the cost of good sold and multiplied it by my sales by month to give me the amount of inventory turned for the month. I know inventory control is the business conundrum, but I was wondering if there is a percent increase over inventory turned that resale businesses generally use to approximate a budgetary inventory number. It seems to me raising "inventory turned" by about 50% should cover necessary on hand inventory to justify a sales budget. Please let me know if there is an industry standard, or what some of you may otherwise use. thanks,
1 year ago - 1 answers
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I could be very wrong, but I think you are entering the philosophy of "much ado about nothing", Shakespeare. STudy both just in time inventory control and credit. YOU should need no budget for inventory. KEEP none past its due date. ONly the customer should be paying for inventory. if the store is, it is carrying too much. That's what I teach my students/clients
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biz teacher
by kemperk
1 year ago
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